In the case of Gerber Federal Credit Union v. Shields, unreported, Docket # 303663, the Michigan Court of Appeals were faced with a case brought by a credit union against homeowners who allegedly removed cabinets, a sink and countertops from the home that the credit union had foreclosed. Gerber Federal Credit Union foreclosed on a house owned by the Shields. After the Shields moved out and the credit union took possession, they discovered that the items were missing from the home. In addition, the credit union provided evidence that the cabinets, sink and countertops in the Shields’ new home resembled the fixtures that had previously been installed in the foreclosed home. However, the court of appeals agreed with the trial court and held that the credit union did not prove that the Shields had removed the items. The case was decided based upon the relative credibility of the homeowner versus the credit union employee.

While this is interesting, this case was decided based upon a prior version of the foreclosure statute. As of December 22, 2011, under MCL §600.3278, a homeowner can be held liable for “physical injury” beyond “normal wear and tear” to a foreclosed property. This section is new so there is no case law interpreting it yet, so it is not clear what a court will determine to be “physical injury” to a structure. Certainly, using a sledgehammer to put holes in walls would fall within the statute, but it is questionable whether removing built in appliances or other fixtures would be deemed “physical injury.” Homeowners should take care before removing any built in items from a foreclosed home.